2024 federal budget insights
15 May, 2024

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Committee for Sydney

Statement / 15 May 2024

2024 federal budget insights

Treasurer Jim Chalmers has delivered the Albanese Government’s third federal budget and projects a second consecutive surplus. This is a budget that attempts to simultaneously tackle inflation and cost of living pressures while investing in Australia’s future economy. It is also a budget that many have already called an election budget – one that attempts to make everyone a winner.  

The result, however, is commitments that spread funding widely but mostly at levels too thin to make substantive, long term structural change.  

It is a budget that recognises Australia’s housing crisis, with the commitment of the government towards new home delivery and student accommodation and $16.5 billion towards the infrastructure needed to support growing cities and regions. While these investments look significant, they will struggle to address the scale and reach of the affordability crisis. A report released by the Committee for Sydney last year highlighted that the cost of Sydney’s housing unaffordability to our economy was $10 billion per year. And that’s just to the Sydney economy. The crisis is significant and requires equally significant funding to help address it. The budget does have a particular emphasis on the funding and support of social and affordable housing delivery, which the Committee supports. 

For NSW, it is also a budget that slashes the share of the GST carve up, reducing the state’s GST receipts by $11.9 billion over the next four years. This will have a significant impact on NSW’s own upcoming budget and risks reducing state-funded investment in key areas such as social housing and energy transition to plug this funding gap. 

Where the budget does signify a substantive policy shift is in its commitment to national industry policy. The Commonwealth Government has committed over $24 billion to supporting Australia’s emerging renewable energy sectors, higher education reform and quantum computing capabilities, among others. This is the most targeted element of the budget and brings Australia in line with the policy directions of other countries around the world investing in future industries and the decarbonisation of the global economy. This level of commitment by the Commonwealth Government is required if Australia is to realise its potential as a global renewable energy superpower, and the Committee for Sydney commends this targeted approach to supporting Australia’s future economic development. 

What does this mean for Sydney? 

There is a lot in this year’s budget to digest, and while it is a budget for Australia, the Committee for Sydney has reviewed it to identify announcements which are likely to have an impact in Sydney.  

Key takeaways are: 

  • Sydney is the least affordable housing market in Australia. The budget outlines support for housing, with a focus on delivering social and affordable housing, supporting those who deliver and manage it and supporting renters through investment in the Commonwealth Rental Assistance Program. 
  • Sydney has had a clear focus on addressing the historic east-west imbalance of jobs and infrastructure investment. The budget reinstates funding commitments of $1.9 billion to support the completion and operation of Western Sydney Airport and road infrastructure investments along Elizabeth Drive and in the Mamre Road precinct.  
  • Sydney will play a significant role in the future of the Australian economy. This budget creates significant opportunities to leverage Sydney’s deep labour market, strong innovation and research sector and manufacturing strengths through commitments to Future Made in Australia industry policy and Medical Research Future Fund announcements among others.  
  • The budget has a focus on support for the care economy – those who work in sectors such as aged care and childcare and who are disproportionately affected by the spatial inequality patterns in Greater Sydney. 
  • Sydney will benefit from access to cheaper electric vehicles, and more accessible charging infrastructure, with over $150m committed to the new Vehicle Emissions Standard installation of charging infrastructure. 

Below is a summary of specific budget commitments that we think will have an impact on Sydney. 

  • $1.9 billion over five years from 2023–24 (and $0.5 billion per year ongoing from 2028–29) to increase all Commonwealth Rent Assistance maximum rates by 10 per cent from 20 September 2024 to help address rental affordability challenges for recipients.  
  • Subject to states and territories signing the new National Agreement on Social Housing and Homelessness. The federal government will provide: 
  • $423.1 million over five years from 2024–25 in additional funding to support the provision of social housing and homelessness services by states and territories 
  • $1.0 billion in 2023–24 for states and territories to support enabling infrastructure for new housing through a new Housing Support Program – Priority Works Stream 
  • Supporting more community housing providers to access finance through the Affordable Housing Bond Aggregator by increasing the cap on the government’s guarantee of Housing Australia’s liabilities by $2.5 billion to $10 billion  
  • $1.9 billion in concessional finance to support community housing providers to deliver social and affordable housing under the Housing Australia Future Fund and the National Housing Accord 
  • $19.7 million over six years from 2024–25 to support housing research, fast-track feasibility studies on the release of Commonwealth land to support social and affordable housing 
  • Allowing foreign investors to purchase established build to rent properties with a lower foreign investment fee, conditional on the property continuing to be operated as a build to rent development 
Transport, infrastructure and planning  
  • $100 million in a new national Active Transport Fund that is set to upgrade and deliver new bicycle and walking paths.  
  • $1.9 billion for projects in Western Sydney, including $500.0 million for the Mamre Road Stage 2 Upgrade and $400.0 million for Elizabeth Drive – Priority Sections  
  • $115.0 million for Zero Emission Buses Tranche 1 Infrastructure – Macquarie Park Depot in New South Wales 
  • $302.6 million over five years from 2024–25 (and $53.5 million per year ongoing) to enable operations at Western Sydney International (Nancy-Bird Walton) Airport. The Government will also provide equity to WSA Co Limited to support completion of Stage One of Western Sydney International (Nancy-Bird Walton) Airport, with the financial implications not for publication (nfp) due to commercial sensitivities 
  • $12.6 million over four years from 2024–25 to support the delivery of the government’s urban agenda, supporting a national approach to sustainable urban development, oversight of urban renewal projects and the continued delivery of city and regional deal projects 
Economy and industry 
  • Future Made in Australia 
    • Establishment of a National Interest Framework to create a ‘single front door’ for international investment attraction as part of a $54.7 million commitment over two years 
    • $19.7B over 10 years to accelerate investment in Future Made in Australia priority industries, including renewable hydrogen, green metals, low carbon liquid fuels, refining and processing of critical minerals and manufacturing of clean energy technologies including in solar and battery supply chains. While many of these activities are based in regional Australia, Sydney has a highly skilled labour market and a maturing innovation ecosystem anchored by world-class universities. Much of the research and many of the knowledge sector skills will be drawn from Sydney to drive this forward. 
    • $218.4 million over eight years to support workforce skills and diversification in the clean energy sector, including $55.6 million to establish the Building Women’s Careers program to improve women’s access to flexible, safe and inclusive work and training opportunities in traditionally male-dominated industries of national priority, including clean energy sectors 
  • $165.7 million over five years from 2023–24 to establish the Defence Industry Development Grant program for Australian defence industry, supporting Australian businesses to increase their scale and competitiveness and respond to Defence’s capability requirements 
  • $1.4 billion over 13 years from 2024–25 through the Medical Research Future Fund (MRFF) to continue to invest in life-saving medical research in Australia 
  • $46.9 million over four years from 2024–25 to support the development of industries in Australia and maintain the affordability of nuclear medicines for Australians, including $25.9 million over two years from 2024–25 to the Australian Nuclear Science and Technology Organisation (ANSTO), based in Southern Sydney, to continue production of affordable nuclear medicines 
  • $69.7 million over four years from 2024–25 (and $3.6 million per year ongoing) to support Australian businesses and to boost Australia’s trade, tourism, and investment opportunities 
  • Support for care economy, including: 
    • $116.2 million over five years from 2023–24 to strengthen and support the health workforce 
    • $30.0 million over two years from 2024–25 in IT and payment services to deliver on its commitment to provide funding towards a wage increase for the Early Childhood Education and Care sector 
    • $531.4 million in 2024–25 to release 24,100 additional home care packages in 2024–25 
    • $65.6 million over four years from 2024–25 to attract and retain aged care workers, collect more reliable data, and improve the outcomes for people receiving aged care services through existing aged care workforce programs 
    • $18.6 million over five years from 2023–24 (and $3.1 million per year ongoing) to support Carer Payment recipients through increased flexibility to undertake work, study and volunteering activities 
    • Limited funding for circular economy policy ($23 million in 24-25, with further funding considered after a national circular economy framework is delivered)
  • $8.6M in Revive live program to provide essential support to live music venues and festivals showcasing Australian bands and artists – to ensure the long-term sustainability of the live music sector
  • $117.2 million over four years from 2024–25 (and $36.9 million per year ongoing) to support the operations and long-term financial sustainability of the national performing arts training organisations and Australian Film Television and Radio School 
  • Additional $76.2 million over five years to support years from 2023–24 to support Australia’s continued engagement in international climate change and energy transition issues, including a bid to co-host the 31st Conference of the Parties (COP31) in partnership with the Pacific 
  • Further $40.9 million over two years from 2024–25 to continue implementing the Nature Positive Plan: better for the environment, better for business (Nature Positive Plan) 
  • $138.7 million over four years from 2024–25 (and $18.9 million per year ongoing) to improve Australia’s preparedness to respond to all-hazard disasters and resilience to natural hazards 
  • $83.2 million to establish the new National Net Zero Authority establishment. The authority will: 
    • Support workers in emissions-intensive sectors to seize the opportunities of Australia’s net zero transformation, such as access to new employment, skills and support as the net zero transformation continues. 
    • Coordinate programs and policies across government to support regional communities to attract and take advantage of new clean energy industries, while setting those industries up for success. 
    • Help investors and companies to engage with net zero transformation opportunities. 
Education and workforce 
  • Target of 80% of working age population holding a tertiary qualification by 2050.  Done through $1.1 billion over five years from 2023–24 (and an additional $2.7 billion from 2028–29 to 2034–35) for the first stage of reforms to Australia’s tertiary education system in response to the Australian Universities Accord Final Report.  
  • $88.8 million over three years from 2024–25 to support 20,000 new fee-free training places, including increased access to pre-apprenticeship programs, in courses relevant to the construction sector and delivered through TAFEs and industry registered training organisations 
  • Support for vocational education and training system, including: 
    • $26.1 million over four years from 2024–25 for the Skills and Training portfolio 
    • $4.4 million in 2024–25 to drive demand for Vocational Education and Training (VET) in support of delivering the workforce required to meet Australia’s future skills needs 
Equity and fairness 
  • $110.0 million over four years from 2024–25 (and $11.0 million per year ongoing) to accelerate action against the National Agreement on Closing the Gap Priority Reforms in the Education portfolio and extend programs supporting education outcomes 
  • $9.6 million over five years from 2023–24 (and $1.0 million per year ongoing) in additional resourcing to further support informed policy advice to Government to end gender-based violence